• Operation creates a global leader in consumer, healthcare packaging solutions
• Combination of Complementary Businesses Expands Product Offering and Capabilities
• Combined R&D and Innovation Investment Accelerates Development of Sustainable Packaging Solutions
• $650 Million Annual Earnings Synergies Benefit

November 19, 2024 Amcor plc and Berry Global Group, Inc. today announced they have entered into a definitive merger agreement, pursuant to which Amcor and Berry will combine in an all-stock transaction.

Berry shareholders will receive a fixed exchange ratio of 7.25 Amcor shares for each Berry share held upon closing, resulting in Amcor and Berry shareholders owning approximately 63% and 37% of the combined company, respectively. The transaction has received unanimous approval of the boards of directors of both Amcor and Berry and values Berry’s common stock at $73.59 per share.

The transaction is worth an estimated $8.4 billion, based on a price of $73.59 per share for Berry’s stock.

The combination brings together two highly complementary businesses to create a global leader in consumer packaging solutions, with a broader flexible film and converted film offering for customers, a scaled containers and closures business and a global healthcare portfolio. The combined company will have innovation capabilities and scale, and be positioned to accelerate growth, address customers’ and consumers’ sustainability needs, unlock portfolio transformation and deliver value to both sets of shareholders.

Amcor CEO, Peter Konieczny, said “This combination delivers on our strategy to accelerate growth by putting the customer first, elevating the role of sustainability and orienting the portfolio toward faster growing, higher margin categories. We will have a more complete and more sustainable product offering, supported by stronger innovation capabilities, global scale and supply chain flexibility. We will help global and local customers grow faster and operate more efficiently with a team of exceptional talent. As a result, this combination also drives a step change in annual free cash flow, earnings growth and value creation for our shareholders. I, and the Amcor team, look forward to joining with Berry to accelerate change and real impact for our customers and their consumers.”

Berry CEO, Kevin Kwilinski, added, “Over the past year, Berry has undergone a significant transformation, completing the spin-off of our HHNF business, enhancing our product mix and optimizing our portfolio. Our combination with Amcor is a logical next step in our company’s evolution, and it is a testament to our entire team that we’re well positioned to build on this momentum and deliver even more value to our shareholders. We expect to better serve customers through a comprehensive and innovative consumer packaging portfolio and a complementary geographic coverage. Importantly Berry and Amcor have aligned philosophies focused on safety, employee experience, sustainability, innovation, customer intimacy, and functional excellence. We will be better together, and I look forward to all we will achieve as a combined organization.”

The two companies reported strategic benefits resulting from the merger operation:

• Stronger business, strategically focused on high-growth, high-margin categories with greater capabilities and a more complete product offering for customers
• Creates a global product offering in flexibles, containers and closures by combining Amcor’s global flexibles and regional containers businesses with Berry’s regional flexibles and global containers and closures businesses
• Combines two highly attractive and complementary global healthcare businesses
• Strengthens positions in high-growth, high-value categories, including Healthcare, Protein, Pet Food, Liquids, Beauty & Personal Care, and Food Service
• Brings together complementary innovation capabilities and platforms, material science expertise and specialized tooling, design and multi-component assembly capabilities
• Creates the innovation partner of choice developing the most sustainable packaging solutions
• Offers customers a wider range of more sustainable solutions which drive circularity, increase use of alternative materials and lower carbon footprint
• Delivers greater choice for customers and consumers with a portfolio of unique flexible, container and closure solutions developed using a broader range of recycled materials, next generation lightweighting technologies, reuse and recycle ready capabilities and differentiated high barrier paper based formats
• Establishes technology driven innovation leader with more capabilities and significantly higher capacity to invest in solving technical challenges with combined R&D investment of $180 million per annum, ~1,500 R&D professionals, 10 innovation centers worldwide and 7,000+ patents, registered designs, and trademarks
• Enhances capabilities by leveraging corporate venturing partnerships to access new and groundbreaking sustainability solutions (substrates, barrier, fiber and recycling), digital solutions and disruptive ideas in adjacent businesses and technologies
• Scale and reach provide local expertise, global capabilities and supply chain resilience
• Optimizes footprint servicing customers in 140+ countries through ~400 production facilities, brings global capabilities to local customers and provides local access and expertise to global brands
• Supports customers in accessing broader growth opportunities and addressing specific regional needs with a balanced geographic presence across continents including in high-growth emerging markets
• Enhances scale and reach that ensure supply chain resilience in a dynamic world and access to global manufacturing best practices

Other financial benefits mentioned by Amcor and Berry include

• Strong combined financial profile
• Combined revenues of $24 billion and adjusted EBITDA of $4.3 billion, including run-rate synergies
• Combined revenue growth above market, accelerating by at least 1%
  Strong combined annual cash flow1 of over $3 billion, providing significant capacity to fund organic reinvestment, a compelling dividend, value accretive M&A and share repurchases
• Expected net leverage of 3.3x at close with path to de-lever below 3.0x within first full year
• Commitment to investment grade balance sheet and continued annual dividend growth from Amcor’s current annualized base of $0.51 cents per share. Berry expects to maintain its current dividend policy until the close of the transaction
• Unlocks further opportunities to refine portfolio, enhancing focus on high-growth, high-margin categories and releasing capital to drive further growth
• $650 million benefit from identified cost, growth and financial synergies by end of third year
• $530 million annual run-rate pre-tax cost synergies
• $60 million in annual run-rate financial savings
• $60 million annual run-rate pre-tax earnings benefit from growth synergies, including from:
  • Increased exposure to higher growth, higher value categories including Healthcare, Protein, Liquids, Pet Food, Beauty & Personal Care and Food Service
  • Combined innovation capabilities to better serve customers and unlock growth opportunities
  • Differentiated commercial capabilities deployed across a broader platform
  • Additional $280 million of one-time cash benefits from working capital efficiencies offsetting approximately $280 million of expected pre-tax costs to achieve synergies
• Significant value creation for all shareholders
  • Over 35% adjusted cash EPS accretion and expected double-digit return on investment2
  • Enhanced long-term shareholder value creation through sustained higher expected earnings growth from 10-15% to 13-18% per annum

Timing and Approvals

The transaction has been unanimously approved by the boards of directors of both Amcor and Berry. Closing is targeted in the middle of calendar year 2025. The closing of the transaction is subject to shareholder approvals, regulatory approvals, and satisfaction of other customary closing conditions.

Board, Management, and Head Office

Peter Konieczny will serve as Chief Executive Officer, Graeme Liebelt will serve as Chairman and Stephen Sterrett will serve as Deputy Chairman of the combined company. Amcor will maintain its primary listing on the NYSE and its secondary listing on the ASX. The combined entity will be named Amcor plc.

Global Head Office will remain in Zurich, Switzerland. The combined company expects to maintain a significant presence in Evansville, Indiana. Upon completion of the transaction, Amcor’s board of directors will expand to 11 directors, 4 of whom will be nominated by Berry.

Berry will separately release its fourth quarter and fiscal year 2024 earnings release before trading on the New York Stock Exchange begins today, Tuesday, November 19, 2024. As a result of the transaction with Amcor, Berry will no longer host its previously planned quarterly conference call. Berry will post prepared remarks and a presentation regarding its fourth quarter and fiscal year 2024 earnings results on the Company’s website at berryglobal.com.

Amcor is a global leader in developing and producing responsible packaging solutions across a variety of materials for food, beverage, pharmaceutical, medical, home and personal-care, and other products. The company offers a range of innovative, differentiating flexible and rigid packaging, specialty cartons, closures and services. The company is focused on making packaging that is increasingly recyclable, reusable, lighter weight and made using an increasing amount of recycled content. In fiscal year 2024, 41,000 Amcor people generated $13.6 billion in annual sales from operations that span 212 locations in 40 countries.

Berry is a global leader in innovative packaging solutions having over 34,000 global employees across more than 200 locations. The company partners with customers to develop, design, and manufacture innovative products with an eye toward the circular economy.

Source: Amcor / Berry